Atul Auto Shows Strong Financial Performance in Q2 FY24-25, But Some Areas Need Improvement

Gross Profit Margin (GPM) - Quarterly: At 11.57 % down from average Gross Profit Margin of 12.05 % over last 5 quarters.GPM trend is negative.

Atul Auto, a smallcap company in the automobile industry, has recently declared its financial results for the quarter ending September 2024. The company has received a 'Sell' call from MarketsMOJO, a leading financial analysis platform.

Despite this, Atul Auto has shown a very positive financial performance in the second quarter of FY24-25. In the last three months, the company's score has improved from 12 to 21. This is a significant improvement and reflects the company's strong financial standing.

One of the key factors contributing to Atul Auto's success is its Profit After Tax (PAT) for the half-yearly period, which has grown by 573.94% year on year, reaching Rs 6.73 crore. This is a very positive trend for the company. Additionally, the company's Operating Cash Flow has been consistently growing over the last three years, with the latest figure being the highest at Rs -0.79 crore. This indicates that the company is generating higher cash revenues from its business operations.

In terms of sales, Atul Auto has also shown a positive trend. The company's net sales for the quarter were at Rs 181.65 crore, the highest in the last five quarters. This is a growth of 20.6% over the average net sales of the previous four quarters. Furthermore, the company's Debt-Equity Ratio for the half-yearly period is the lowest it has been in the last five years, indicating that the company is reducing its borrowing compared to equity capital.

However, there are some areas where Atul Auto needs to improve. The company's Dividend Payout Ratio (DPR) for the last five years has been the lowest at 0.00%. This means that the company is distributing a lower proportion of its profits as dividends. Additionally, the Gross Profit Margin (GPM) for the quarter has decreased from the average of the last five quarters. This is a negative trend for the company.

Overall, Atul Auto's financial performance for the quarter ending September 2024 has been very positive, with strong growth in key areas. However, there are some areas that the company needs to focus on in order to maintain its success in the future. Investors should keep a close eye on the company's performance in the coming quarters.